E-Business Enterprise System - Example

E-Business Enterprise System Assignment 2 [Pick the Presented by: -------------------------- Table of Contents Introduction to the business context based on the given case, and summary of issues identified in the case. Define objectives of your proposed solution. 2 Introduction 2 The business 3 The business process 5 Objectives of Strategic information for the business 6 Brief review on relevant concepts and approaches, academic interests and practical cases, relating to enterprise system selection and implementation issues and integration approaches in the e-business and extended enterprise context. 7 Strategic information needs of the company 7 Porter and Millers five step process 7 Step 1. Assess information intensity 7 Step 2. Determine the role of IT in the industry structure. 8 Step 3. Identify and prioritize the reasons in which IT can earn a competitive advantage for the business 8 Step 4. Investigate how IT bring in new business 9 Step 5. Develop a plan for taking advantage of IT 9 Bakos and Treacy’s causal model of competitive advantage 9 Analysis of issues in the case to identify suitable approaches for extended enterprise integration in the given case; Illustration of key information flows in the extended enterprise which includes the supply chain partners; Critical analysis of suitability of SAP as an ERP tool to the given case, in comparison with other ERP tools or other integration solutions in general, in terms of integration of the enterprise system and supply chains of the company in the given case. 12 The planning approach applied 12 The suitability of SAP as ERP system for the given case: 13 The proposed design solution for the given case 15 Business Expectation from the new System: 15 System functionalities: 16 Enterprise Resource Planning (ERP) 17 Customer Relationship management (CRM) 18 Business Intelligence (BI) 18 SAP Best Practices 18 Discussion and conclusion 19 Works Cited 22 Introduction to the business context based on the given case, and summary of issues identified in the case. Define objectives of your proposed solution. Introduction The possible effectiveness of various types of Information System (IS) for management is well recognized (Diez et al, 2009). Most likely we are able to say developments in information, specification have directed companies to  make an effort to establish IS or information technology (IT) strategies which work together with their business and support  company missions (Simon Rogerson, 1994). The three basic kinds of IS which are designed and generally used are: 1. Financial systems 2. Strategic systems 3. Operating systems Contemporary organizations are progressively considered knowledge based business where in innovative knowledge management is essential for competition (Hollsopple et al, 2000). There are different frameworks used to determine the application and importance of SIS in any organization. Through the use of technology can provide real time data on stock availability across various sites. This real time information can be used to inform accurate demand at point of use and the automatic replenishment to ensure availability at all times. It is essential for the system to provide visibility from start to finish as the product moves through the supply chain (Logipharma, 2011). The business The case under discussion is about a medium sized car manufacturing business. It has a history of continuous growth and development. It produces and supplies more than 200 automotive parts of different utilities. The company’s production is lean and normally delivers in a short period of time. The business has a good reputation with the customer as it is normally responded quickly the car manufacturer’s (customers) demands. The business produces control panels for different frames. The product line also includes various units that are produced for over 2000 customers. The business requires a well integrated supply chain as the most of the part are not produced by the business. They purchase it from different suppliers from different parts of the world. In many cases, one part is supplied by more than one supplier. To overcome the problems such as the overproduction, wastage, lead time and excess stock are challenging the business performance. The company has to overcome this issue in its future growth and development. In this situation it becomes rather mandatory to automate by implantation of most suited information systems. A key area where track and trace technology can really assist organizations is in the event of a recall. Visibility into chain of custody can help identify the owners of the products to be recalled, allowing only the high risk products to be recalled versus all products. This can drastically reduce the costs and effort associated with product recall and recovery (Chatterjee, 2009). The business process Objectives of Strategic information for the business The company is a manufacturing business. The information system holds a strategic importance for the business. It is essential for them to gather and analyze the information well in time to make in time decision. The importance of SIS to for the business depicted in the following diagram. Figure 1 the importance of SIS for the business. (MISRC, 1986) Brief review on relevant concepts and approaches, academic interests and practical cases, relating to enterprise system selection and implementation issues and integration approaches in the e-business and extended enterprise context. Strategic information needs of the company The business is not dependent on the geographical boundaries as the supplier network is spread round the globe. To analyze the SIS needs of the organization following tools and models are applied: 1. Porter and Millers five step process 2. Barks and Tracy framework Porter and Millers five step process Step 1. Assess information intensity For any business where the manufacturer efficiency of the value chain is dependent on the information available the information system is considered have high intensity. This means that in such organization the strategic application opportunities are available (Wiseman, 1984). This is one such organization where the information is needed for smooth conduct of the business and various operations. Failure in prompt and accurate information can cause serious issue for the business. All process is dependent on the availability of the information. High intensity of need refers to high strategic opportunity. The business greatly depends on its supply chain (Enyinda & Szmerekovsky, 2008). Step 2. Determine the role of IT in the industry structure. The strategic value of information system can be determined on the basis of how the customer, suppliers, competitors are affected by the performance of IT in the organization (Wiseman, 1984). The business uses EDI for booking of orders, the supplier is also incorporated online and more efforts are made to make the online experience more efficient for both the supplier and the customers. This is done because both the supplier and customer are affected badly in case of any inefficiency of the information system. Step 3. Identify and prioritize the reasons in which IT can earn a competitive advantage for the business In this step the organization is required to determine the reason why IT is essential for the business to establish the competitive advantage (Wiseman, 1984). Here we have a manufacturing company under discussion with wide spread supply chain. Not only that the business depends on the suppliers of different important components. It is rather important for any business aiming for cost leadership, innovation, strategic positioning and differentiation, etc (Duetsche Bank Technology Conference, 2011). Step 4. Investigate how IT bring in new business Efficient IT capacity can attract new business and customer by providing speedy and satisfying service to the customer. The capacity of any information system depends on the following factors (Wiseman, 1984). Here the business environment is flexible and the business is vigilant to in-cooperate the innovation in technology infrequent basis. Information technology is used as a tool to attack more and more customer. The information system holds the sound potential to meet up with the increasing and ever changing information needs and requirement. This makes the information system in the organization highly strategic in nature and value. Step 5. Develop a plan for taking advantage of IT The Information system development plans should always be business driven rather than technology driven. Bakos and Treacy’s causal model of competitive advantage Figure 2: W13.1.1 Bakosand Tracy’s causal model of competitive advantage (MISRC, 1986) According to this model information needs can be stated as strategic if: It enables the business to create unique products and services (MISRC, 1986). This is a manufacturing business. It is essential for the business to incorporate the technology innovation and modify the service offered to the customer according to it. In this way information technology is not only to facilitate the customer, but also to attract more and more customer by offering them some new and different (Duetsche Bank Technology Conference, 2011). Therefore, the importance of information need is strategic in nature and is very high. Another important question is, does it increase the customer switching cost (MISRC, 1986). The business is highly dependent on its supply chain management. The components are not manufactured locally, but are purchased from different supplier’s world wide. The success of the company that is strategically dependent on its supply chain depends on the practical and logical application of this IT migration (Duetsche Bank Technology Conference, 2011). The other factor that determines the strategic value of information for any organization is by its potential of increasing the internal efficiency (MISRC, 1986). Not only is that, the business depends on its IT framework to get connected with its partners, suppliers, joint ventures and other alliances. To make the process flaw less in the company needs SAP application. Such organizations are vulnerable to counterfeit risks due to increased uncertainties in supply and demand, outsourcing, complex distribution and advancement in technology (Enwind & Szmerekovsky, 2008). Thereby, a well research requirement analysis and application is required. The manufacturing company should apply SIS in designing new business ideas, measures to attract more customer and revenue generation methods. The integration of SAP will enable the suppliers, partners and alliances to utilize one inter phase, data and various critical parts of SIS. This enables the customer to process the reach information conveniently without getting involved into prolonged and confusing procedures. The auto manufacturer should work on the application of SAP to integrate its IS with supplier and dealers. This system is flexible and enable the user to collect information from via synchronized solution (the users can synchronize the information from a PC to their PDAs and vice versa) (Afuah, 2003). Analysis of issues in the case to identify suitable approaches for extended enterprise integration in the given case; Illustration of key information flows in the extended enterprise which includes the supply chain partners; Critical analysis of suitability of SAP as an ERP tool to the given case, in comparison with other ERP tools or other integration solutions in general, in terms of integration of the enterprise system and supply chains of the company in the given case. The planning approach applied There exists a combination of two. First, the planning is a business led. The business determines where the application of the SIS is requires. The business targets and goals should be taken into consideration while planning SIS and e business activities. Therefore the SIS implementation is directly aligned with the business targets and goals. For the business under discussion the following planning approach will be adopted. Business led Method driven Focus Business Technique Foundation Business plan Best method Ends Plan Strategy Methods Our Best Nature Business Top –down Influence IS planer Consultant Role of IS Driver Indicator Metaphor Its common sense It is good for you Table 1: SIS planning approach (Duetsche Bank Technology Conference, 2011) The suitability of SAP as ERP system for the given case: There exist different opinions regarding the implementing the ERP system in SME’s. Different results are generated in different organizations. In some it has enhanced the performance where as in the other it caused troubles in the daily operations. This attracted the attentions of the researchers and many have investigated the impact of an ERP system (SAP for example) is applicable for SME’s. The risk of implantation of ERP is not exclusive to the small business. It holds the same risk element in the large business as well. This is because it involves re-engineering, high investments and restructuring the business process. Estimated cost and implantation time can also play a vital role in the success or failure of any ERP application. Still small and medium size businesses are faced with the pressures of globalization and need to address the needs of the global competition. There are many success stories where the large organizations have enjoyed the advantage of ERP applications. Similarly with the logical and rational application of ERP the small and medium size organization can also enjoy the advantage of knowledge management through ERP. ERP can offer this business real time information system and achieving a standardized, automated and visible information processes (Doom et al; 2009) (Seethamraju & Seethamraju ; 2008). The business environments of today force these small and medium size businesses to accept and adopt change to meet the challenges of today. They need to upgrade, modify and innovate to match the pace of today’s business. But the only quantum of change and ERP implementation is the cost and time analysis. It may only benefit and organization if the business can afford in terms of cost and money. ERP is offered to the SME at low cost by the vendors. Not only that, the needs and demands of SME have been the focus of many ERP vendors. One such example is SAP that provides pre-configured low cost solutions to SMEs by allowing them to choose components according to their current needs and facilitating them to build up or add new components in the future gradually (Seethamraju & Seethamraju; 2008). The application of SAP will reduce the on initial and ongoing cost and reduces the implementation time. At present there are three SAP solutions for SME that hold the potential to increase the suitability of ERP system SAP by Design is a solution with low cost application hosting facility through the internet without any needed investment in the hardware and software. This enables the business to avoid the high end investment and generate the results that any high end IT infrastructure. SAP’s Business One is one promising SAP solution has the capacity to integrate is approximately 550 software core functions. For the business under discussion it can be the possible option as it is considered to be all in one business solution. (Doom et al; 2009) (Yang & Su; 2009) The proposed design solution for the given case Business Expectation from the new System: The main reasons for selecting the SAP All-in-One solution for the given business are: 1- System that would support production system (Make-to-Order) is required. 2- Information visibility as well as high level of integration both internal and external is needed. 3- It will enhance the company stock management. 4- The selected system will streamline production with the customer demand 5- The system should make the business flexible towards the change in demand. 6- It is expected from the system to automate the process. System functionalities: According the SAP, Business All-in-One solution works on application-oriented approach. From the users benefit aspect, the solution includes web features that minimize the need of training as the users (customer\ supplier and employees) can interact through web site interface. Automating the workflows is the other advantage that this SAP solution can bring to the business. The system is able to generate automatic alert fro different scenarios, including the customers with overdue payment, new order, stock shortage, etc. This will not only save time, but also human interaction will be reduced, reducing the potential for errors. Technologically, the solution is powered by SAP Net Weaver process integration (SAP Net Weaver IP) technology platform. This platform will allow the business to integrate both SAP and non-SAP applications by using industry-standard protocols. This platform will be advantageous for business as it decreases the integration cost and develop the connection between the business and its partners. Moreover, the system is seen as a long lasting investment by recognizing both SAP and non-SAP applications, the business may ensure its IT infrastructure will fulfill current and upcoming requirements. Put simply, this system facilitates the application-oriented approach that continues to be highlighted and selected for the presented case by enabling the business to extend its business process down the road without needing to change fundamental applications by connecting the applications with each other to be able to acquire the required integration. The company All-in-One solution provides a number of built-in features that will improve the business operation. The characteristics will be pointed out below and discussed.  Enterprise Resource Planning (ERP) This application is particularly designed by for SME to enable them to acquire all the required targets. It supports the Accounting and financial software, thus allowing the business to properly integrate all the financial management, operational management, inventory management and order management. The business under discussion is dependent on its supply chain management. This software will help the business in integrating the supplies, thereby, resulting in effective supply chain management. It can enable the business to control costs as well as managing sourcing and procurement. This will help the business in effective stock management by providing real time information of the stock level that can be exploited by the supplier in order to make replenishment to the stock. Customer Relationship management (CRM) Having a perfect match with ERP, CRM will allow the business to manage both customer relationship and operation process from end to end. It in cooperates different such as interaction center software that is able to establish customer loyalty, reduce costs and provide supreme services to the customers. Business Intelligence (BI) This will enable the business to incorporate the business, suppliers and the customer together. SAP Best Practices This will provide the business with the methodology to implement and develop the innovative business practices. The packages provide preconfigured support areas such as financial, purchasing, manufacturing and inventory management. Assumptions and limitations For every approach, there are certain assumptions. They vary from organization to organization. For the business under discussion the assumptions are as under: 1. The business plan is capable to support the planning of strategic information system and e business. The business structure is capable to drive the SISP. 2. The business is not leading the IS. Infect IS providing a direction to the business. 3. The management is understanding and flexible to the alteration and suggestions made by experts. Discussion and conclusion Manufacturing business is the backbone of any economy. There are enormous opportunities in such business, but there are also some risks that may threaten the very existence of the business. Two of these risk factors that can efficiently be turned into opportunities are Knowledge management and customer relation. There exists a strong bond between these two factors as with effective knowledge management a better and prompt service can be provided to the customer leading to excellence in the customer dealing and relations. Knowledge management is defined as an approach to creating, mange, harvest, and leverage of knowledge by considering it an asset for the organization. It enhances the business potential to perform efficiently. It is incorporated with the business strategy to provide better and supreme service to the customer ( Parlby & Taylor, 2000). Customer relationship management involves processes such as building and managing the customer relationships with understanding, empathy, anticipating. It includes managing customer needs, demands and requirements by acquiring knowledge about customer preferences to increase efficiency and portability (Nicolett, M., Andren, E., & Gilbert, M. 2000) This business is a customer focused business which is hugely dependent on the supply chain management. They target to raise the customer satisfaction level to a limit that no competitor can cope up with that. As the business is not limited by boundaries with suppliers spread world wide it is essential for the business to incorporate the knowledge management to maximize the customer relationship management. Here an important point to consider is that though the business is operating in the virtual world and demographics do not apply directly to it, but there are certain social and cultural factors that might affect the customer inclination and traffic. All of these factors should be taken into account while planning, designing, implementing and managing knowledge management programmers and systems (Duetsche Bank Technology Conference, 2011). A medium sized manufacturing business is strategically dependent on its information system. It needs information processed and applied in the order the reduce the costs of service, increase efficiency, increase customer switching costs and bargaining power, beat competitions, application of technology and finally to gain competitive advantage in the customer. Having such importance the SIS planning activities are performed by a rational integration of business led and method base approach. A proper application is SAP is also necessary to yield the accurate and desired results from the SIS. This enables the business to adopt state of the art technologies and keep the business orientation intact. Knowledge management is used as a tool to raise the customer satisfaction. Knowledge management related activities are designed keeping the cultural values, norms and traditions of a particular society. Doing this assignment was a learning experience and will prove to be useful throughout my career. Works Cited A. R. Bologa, M. Muntean, G. Sabau, and I. Scorta. (2009.) 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